Skip to main content

Feb 20th, 2024 | Latest News

Welsh Government funding shortfall pushing homelessness workers into poverty

New data collected by Cymorth Cymru and Community Housing Cymru has highlighted the impact of repeated Welsh Government funding freezes on the wages of vital homelessness and housing support workers in Wales. These organisations, which represent over 100 support providers, have written to the First Minister, urging him to provide additional funding in the final budget to deliver on the promise to pay these key workers a fair wage.

Despite promises on the Real Living Wage at the last Senedd election, the Welsh Government has not provided additional funding to the homelessness and housing support sector to uplift salaries and make this a reality.

The Housing Support Grant (HSG), which funds the vast majority of homelessness services in Wales, has been frozen since 2021, resulting in frontline worker wages falling below the upcoming minimum wage. These frontline workers are the very people who support others during acute crises, such as homelessness, domestic abuse, mental health and substance use issues.

Data gathered in December 2023 on the salaries of more than 3,000 workers funded by the Housing Support Grant shows:

  • 41% are currently being paid below the upcoming (April 2024) minimum wage of £11.44 per hour;
  • 67% are currently being paid below the 2023/24 Real Living Wage of £12.00 per hour.

One service provider said that increasing the wages to the legally required national minimum wage in April 2024 would cost them more than £560,000, while increasing wages to the Real Living Wage would cost more than £1.1m. The Welsh Government’s Draft Budget 2024/25 contains no additional funding for the HSG, making this an impossible task for support providers.

A survey of more than 600 frontline support workers conducted last year also showed how they were struggling to make ends meet:

  • 86% said they were not putting on the heating in order to save money;
  • 56% were struggling to pay bills;
  • 18% were struggling to pay their rent;
  • 12% were feeling at greater risk of homelessness.

These concerns about frontline worker pay come on top of the previously published data, which shows that a cash-flat budget for the HSG is likely to result in:

  • 77% of service providers reducing service capacity;
  • 40% of service providers handing back existing contracts;
  • 67% of service providers not bidding for new or re-tendered contracts.

This means there will be a reduction or complete withdrawal of homelessness and housing support services at a time when there is unprecedented demand.

For 2024/25, Welsh Government must increase the Housing Support Grant in line with inflation to enable frontline workers to be paid a fair wage and to avoid many services collapsing. Cymorth Cymru and Community Housing Cymru estimate the required uplift to be 10%, which equates to £16.7m.

Katie Dalton, Cymorth Cymru Director, said:

“Fair work and the Real Living Wage were at the heart of Welsh Labour’s election manifesto and Programme for Government, and we were promised that homelessness and housing support workers would be included in the Real Living Wage commitment.

“Since then, the sector has not received a penny more in funding to deliver this pledge. It is unacceptable that workers who do such skilled, complex and traumatic jobs are paid so little, and it is intolerable that the very people who are tasked with preventing homelessness are being pushed closer to homelessness and poverty themselves.

“We urge the First Minister and the Finance Minister to increase the Housing Support Grant budget and deliver on the promise to pay these critical workers a fair wage for their life changing, and often life-saving work.”

Rhea Stevens, head of policy and external affairs at Community Housing Cymru, said:

“The housing crisis is pushing more and more people towards homelessness already. To see the very people who have dedicated their careers to providing the life-changing help that others need being at risk of significant hardship too is wholly unacceptable.

“Ending homelessness means addressing its complex causes, intervening early with the right support. The frontline staff who work in Welsh homelessness and housing support services have the unique combination of skills, experience and compassion needed to do this, and they deserve fair pay.

“We know Welsh Government is committed to ending homelessness in Wales. But to do so requires protecting and investing in the hard-working staff who deliver life-changing work every day in communities across Wales.”